Business Continuity, Command & Control, Policy & Planning

Earthquakes in Asia: Whole Lotta Shakin’

6 November 2008

By Nathaniel Forbes, President, Asian Chapter, International Association of Emergency Managers

It’s hard not to notice earthquake risk in the Pacific Rim these days. Since May, Asia has had three earthquakes of 6.0 or higher on the Richter scale, the magnitude at which earthquakes are generally considered destructive.

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• SPOTLIGHT

The Wenchuan earthquake in China’s Sichuan province in May drew worldwide attention to the enormous impact of a big earthquake: 70,000 people killed, 18,000 missing, 375,000 injured, 5 million people homeless. China is in the largest orogenic zone on the planet (that’s how the Himalayas got there), but Wenchuan had “never been considered high-risk compared to cities near other fault lines,” according to Hong Kong-based seismologist Dr Michael Spranger. And now the earthquake risk in China is even higher after the Wenchuan earthquake, according to Spranger.

The Indian Ocean earthquake near Sumatra that caused the 2004 tsunami was also in an “unexpected location,” Dr. Spranger says. In fact, Munich Reinsurance reports that Sumatra accounted for nearly a quarter of all earthquakes measuring 6.9 or greater in the world since the 2004 tsunami; Sumatra had accounted for only 2 per cent of them in the previous thirty years.

“We have geological record back 1000 years. It shows the region being hit by major quakes every 200 to 300 years. The last cluster of powerful quakes happened about 200 years ago. We are entering a new cluster,” Prof Kerry Sieh, director of the Nanyang Technological University (NTU) Earth Observatory, said in Singapore’s Straits Times newspaper.

So, recent earthquakes have been more frequent, they’ve been more serious, it’s likely that more are coming, and they might happen in places we don’t expect. Well, then.

In fact, Singapore’s NTU has two government-sponsored earthquake studies in progress right now. The Monetary Authority of Singapore (MAS) is co-funding one study to assess the impact of natural catastrophes on the financial sector, and the Building & Construction Authority (BCA) is funding an earthquake vulnerability study as part of its “review (of) building codes and regulations after several major earthquakes in the region.”

“What is certain is that our buildings are not designed to withstand earthquakes,” Munich Re’s Dr. Spranger says. The studies could easily have been kept quiet, so the government has obviously decided to draw attention to that risk.

Any official hint that earthquakes could happen in Singapore is remarkable because “in known history, Singapore has not experienced an earthquake,” according to Singapore’s National Environment Agency. The BCA has a hotline for “tremor due to distant Earthquakes” (sic), but not a hotline for Singapore earthquakes – a subtle distinction.

So it’s official: earthquakes are no longer banned in the Republic.

But on the night on September 11, Hokkaido, Japan experienced a 6.8-magnitude earthquake just off the coast, and Halmahera, Indonesia was rocked by a 6.6-magnitude quake at almost exactly the same time. Two big earthquakes in Asia at the same time on a September 11: that should be enough to make anybody superstitious.

The Impact The social and business impact of planning for earthquakes in Asia will be significant, even if no earthquake occurs for many years.

First of all, insurance companies are about 6.5 Richter points away from a tsunami of claims from a big earthquake in one of Asia’s megacities. I imagine one of Munich Re’s motives for publicising its report so widely was to provide “cover”, as it were, for a contemplated increase in its re-insurance rates, with or without another earthquake.

Property owners in Singapore, Hong Kong and Kuala Lumpur pay little or nothing extra for insurance that routinely includes earthquake cover. An insurance claims manager complained to me: “We’re giving it away almost for free!” No insurance company has wanted to be the first to add an earthquake premium. I expect that to change, starting in 2009.

If building codes are revised to mandate greater resistance to horizontal ground motion (lead dissipators, for example, or lead & rubber bearings), commercial construction costs in Asia will increase even more than they have in the last year. Those costs will be passed on in office rent increases, whether or not an earthquake occurs.

The business impact of a break in the supply chain between China or India and North America becomes more severe with every gadget manufactured in Shenzhen (China), every line of code written in Bangalore and every phone call answered in Parel (India). Manufacturing or distribution interruptions from the next large earthquake could result in restricted supply, and therefore higher prices, for consumers everywhere.

To be prepared for an earthquake in one of its urban centres, Asia’s private sector should put much greater effort into emergency management than it has in the past. Banks, brokers and fund managers in Singapore, for example, don’t have medical equipment, emergency response training or environmental health & safety (EH&S) officers. Fire wardens in most companies are barely trained; some can’t even lift a fire extinguisher, let alone aim and discharge it. Employees routinely ignore or circumvent evacuation and assembly drills that could save their lives in an earthquake.

The countries in Asia most at risk of earthquakes are also those with huge numbers of people, many of them very poor, many in enormous urban agglomerations. There is no way that Asia’s governments or the many non-governmental organisations (NGOs) that provide critical disaster relief here will be able to manage the response by themselves. Emergency managers, security professionals, business continuity planners, relief workers and disaster responders – from the private and public sectors - will have to learn to work together, or we will all fail.

The process of building resilience by building bridges between professionals won’t be as expensive as retrofitting infrastructure, but it will take a lot longer, and so far as I can see, it has barely started.